Mexican bottler Coca-Cola FEMSA to buy Grupo Yoli for $700 million

Mexican bottler Coca-Cola FEMSA yesterday agreed to buy Grupo Yoli, S.A. de C.V., (Grupo Yoli), one of the oldest family-owned Coca-Cola bottlers in Mexico,  in a deal valued at around $700 million.

The deal comes a month aftert Coca-Cola FEMSA agreed to buy 51-per cent in Coca-Cola Co's Philippine bottling operations for $688.5 million in cash.

The Grupo Yoli deal has been approved by both Coca-Cola FEMSA's and Grupo Yoli's boards and is subject to the completion of legal, financial, and operating due diligence and to customary regulatory and corporate approvals, including the approval of The Coca-Cola Company and the Mexican regulator.

Grupo Yoli will get 42.4 million of newly-issued Coca-Cola FEMSA L shares, each valued at 184 pesos. Coca-Cola FEMSA will absorb 1.009 billion pesos in net debt.

Under the deal, Coca-Cola FEMSA will become the owner of a 10.14-per cent stake in Promotora Industrial Azucarera, a stakeholder in the Mexican sugar industry, boosting its holding in one of Mexico's leading sugar producers to 36.3 per cent.

Grupo Yoli was founded in the state of Guerrero in 1918 under the name of "La Vencedora." The Coca-Cola Company granted the first franchise agreement to these territories in 1938.